mookiemcgee wrote: If I make $1000/month and I need to spend $1000 month to survive, how does gold or silver or anything else help me?
It doesn't. A person in that scenario isn't making enough or/and is spending too much.
mookie wrote: Does knowing that they are being screwed change their situation in any tangible way?
Yes. It can. I makes you aware of how money works and hopefully, if one is wise, can make changes in their lifestyle so as to provide for the future. I'm sure you'll agree, living paycheck to paycheck is unwise, dangerous and a recipe for disaster. I know, a large segment of the population is living paycheck to paycheck, but they don't have to and they shouldn't. Virtually any income bracket can make serious plans, stick to them and in the end when it comes to retirement, they'll be set. If they can budget correctly and stick to that budget. But it means lifestyle changes, which people often resist.
mookie wrote: and they invested it in say Goldman sachs (for you Patches) instead they would be better off than keeping the silver...
Maybe. Investing is always a gamble, there is risk. High risk means high reward but also greater chances you'll lose your investment, your savings. Hindsight in stock picking is great, but irrelevant, because you don't have hindsight. That's where precious metals come in, they are low risk. Where as stocks you are invested in can plummet to zero overnight, precious metals never go to zero. Bonds are low risk, provided they aren't bonds from Zimbabwe for instance, but they are low yield, hence the low risk, low rewards. They often don't keep up with inflation. Silver is nice because it's cheap, more easily to obtain than, say, gold.
mookie wrote: Knowing that their currency is slowly being devalued in no way changes their situation or their ability to change it. It does not affect their lives.
It can change their lives, that understanding. But the people who don't have the "ability to change it" I.E. their economic situation, are in error in that regard. One can change their economic situation, at least in the US, if they are willing to take a serious look at their spending, their lifestyle and their needs balanced against their incomes. Hard choices are often needed, the kind of choices people don't like making.
The reason that inflation is so bad, or currency devaluation, is that it punishes the savers and rewards the debtors. Inflation is great if you are in debt, but if you are a saver then inflation is a killer. The devaluation of the dollar correlates with the rise in people living paycheck to paycheck. The opposite is true about deflation. Deflation rewards the saver but destroys the debtor. Which is why the USG and the Fed fear deflation so much. People in debt have their worth tied up in property and assets like stocks and such, which are inflated in price. When deflation hits their properties that were worth "X" one day and the next worth "X-Y%" but they'll still have the same debt level. For savers, deflation is like getting a dividend on your cash, on your savings.
This type of living, this type of system that punishes savers while rewarding debtors contributes to over consumption, malinvestment and wasted resources because the debtor is spending future earning today. This one facet affects so much more. You are worried about climate change? Doesn't it make more sense to conserve (i.e. save)? Concerned about the ever expanding wellfare state? Doesn't it make more sense to save than to go into debt to the point where you need assistance from the State? Worried about over consumption? Doesn't it make sense to save for what you want and get it then rather than to go into debt to get those things now?
We weren't always like this, Americans, we were savers once. Not anymore. There is no point to it if you don't think about the future. People gotta have that new gizmo today, eat out instead of being bothered to cook at home, to busy working to plant their own gardens.
For the people who don't save, who live paycheck to paycheck, gold isn't going to help them. Nor is any other investment. They'll always lose ground financially which leads to all kinds of other problems and stresses. Worried about people killing themselves? Financial struggles being one of the biggest reasons people off themselves. You can imagine how the list grows of all of societies ills when you understand that in our current system you are punished for saving and rewarded for being in debt. But such a model is not sustainable. If you care about rising health costs or rising tuitions then you should be advocating for sound money principles instead of expanding credit and money supplies (our current system). That only exacerbates the problem. Throwing money at things only causes those things to increase in price.
The solutions often proposed by politicians and people with ulterior motives almost always advocate more spending, more debt, more burden that always hits those who can least afford it. A person living paycheck to paycheck isn't going to be helped paying a carbon tax for instance. They have enough problems in their lives without having to try and save the Earth. You can say they'll have a cleaner, better planet but they are still just one disaster away from destitution, which is what they really fear, is it not? And people fall for this stuff because they don't understand how throwing money at problems only increases the price of those things.
Our whole economy is built on people buying stuff they don't need with money they don't have. The #1 American export is financial instruments. Our reserve status allows us to export inflation. America used to produce things, things have value. Now we get everyone else in the world to produce things and we buy those things on credit. It's insanity, IMO.
But you are correct, the poor saps who don't have enough money to pay for all their expenses, none of this matters. Not because it's immaterial though, but because they either don't have the wisdom. the skills or the resolve to change their situation where they can finally think about investing in themselves for the future. You can lead a horse to water as the saying goes, and I think that's what Armati is trying to do in a way. At least I hope so, though he may be a little clumsy at it, he probably means well.
Knowing something is useless though without action. There is no magic plan, there is no perfect solution, there are only trade offs. Don't ever believe anyone who says they can fix all your problems. No politician, no President, no ideology, no preacher, no one has the magic wand to wave and fix everyone's problems, financial or otherwise. That power resides solely in the individual and maybe a little bit of luck. Some bad luck can be truly devastating, but that's the universe for ya' I suppose. It just doesn't give a shit about any of us in the end. IMO